The pub, which is popular with the gay community, has been rebuilt exactly as it was, with the addition of a specially-sculpted light as a memorial. It has three flickering candles and 86 twinkling bulbs in remembrance of the dead and injured from the blast.
The pub re-opened at 6.37pm after a short ceremony and a minute's silence on the eve of London's annual gay and lesbian street march and festival. This year it has been modelled on the flamboyant Mardi Gras events in Sydney and San Francisco.
Last year the Gay Pride celebration had to be cancelled after the organisers - a mixture of gay and lesbian community groups - failed to sell enough tickets. The Gay Pride event accumulated debts of pounds 160,000 even when a record 250,000 people turned up in 1997.
This year the gay and lesbian communities formed a Mardi Gras company and hired one of the organisers of Sydney's event. Anthony McNeill, who is Manchester-born but has lived in Sydney for 13 years said the Sydney Mardi Gras contributed pounds 40m to the city's economy and attracted tourists from all over the world. He wanted to see the London celebration do the same thing.
This year the organisers have paid for 1,000 excessive, Rio-style costumes to be made to encourage marchers to get into the spirit of carnival.
Almost 40,000 of the 65,000 tickets had been sold by the beginning of the week for the after-march party in Finsbury Park in North London where bands like Steps, Billy, East17 and Boy George will perform.
But Peter Tatchell, of the gay and lesbian pressure group Outrage!, believes the event has been sanitised. "The organisers are actively discouraging people from making a political statement," claimed Mr Tatchell. "What was a march for human rights is now being downgraded to a spandex and sequins Rio-style carnival."
But Mr McNeill defended it. "When I came in, I realised it was a major confidence-building exercise," he said. "But the general feeling I get is that people want this to happen and we should not be diverted from what we are doing by criticism."